No Say on Whitacre’s Pay

Add Ed Whitacre, Chairman and CEO of AT&T, to the list of CEOs enrolled in the Lee Raymond Skydiving Institute (motto: It is the size of your golden parachute that matters, not what you do with it). Whitacre has a nice $158mm parachute packed up, on top of his total compensation last year - a whopping $60.1mm. Here’s a rundown of Whitacre’s compensation (in millions): - $2.1 Salary - $46.9 Options - $6.8 Non-equity incentives - $4.5 Pension and deferred comp - $0.5 “Other” compensation The “other” category includes: - $14k for financial counseling and for people to do his taxes [even his money needs to be counseled] - $27k in auto benefits [free wash and wax... for 50 cars] - $38k for the corporate jet [those are some hot flight attendants] - $11k in supplemental health insurance [in case of meteor] - $25k in club memberships [but still doesn’t have a Duane Reade club card] - $101k in company matches to deferred comp [we ’ll see your ridiculous expenses, and raise you 100%] - $8k in communications and security [he does not take advantage of his nights and weekends cell phone plan] - $25k in tax reimbursements [does he get to reimburse himself for the money he expensed for people to do his taxes?] - $214k in life insurance premiums Where are activist nuns when you need them? The WSJ’s Deal Journal reports that Whitacre’s package may be a bit over the top considering AT&T’s performance relative to the market.

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AT&T argues that the pay is deserved because the company has “outperformed its peers in delivering value to stockholders” during Whitacre’s tenure. But how about a more basic measure of performance, like how an investment in the company has stacked up against the broader stock market since Whitacre, a serial acquirer, took the top job at the company, then known as SBC Communications, in 1990? By that scorecard the conglomerate that he now runs — which has morphed into the new AT&T — is valued at just under 2.5 times its worth back then, while the Standard & Poor’s 500 stock index has risen more than four fold.